By the end of 2017 the IRS plans to send notification to applicable large employers (ALE) of potential liability for failure to comply with the “pay or play” mandate of the Affordable Care Act (ACA). These notifications (Letter 226J) will be sent to ALE employers that the IRS determines had one or more employee, in at least one month in 2015, that received a subsidy toward health care premiums purchased through the marketplace because the employer failed to provide health coverage that is compliant with the ACA requirements (affordable and providing minimum essential coverage). The IRS will make this determination based on information provided by employers on Forms 1094-C and 1095-C (required ACA reporting forms) as well as information provided to the IRS on individuals’ tax returns. Continue reading →

A lot has happened over the past few years. The Affordable Care Act, or ACA, has transformed the way millions of people obtain health insurance coverage for themselves and their families. But it’s a complicated law, with a lot of moving parts. Many consumers, workers and human resources professionals/employers are confused about whe
re their role in covering workers ends and the ACA begins. This is particularly true in instances where a worker has left the job and is no longer eligible for coverage under the employee group plan. Here are answers to some of the most frequently asked questions:

At some companies, there may not be a well established system in place for handling the tasks necessary to comply with COBRA. Here’s a brief overview of COBRA as well as a question from a concerned employer about the implications of not complying, along with a detailed answer.

COBRA BasicsThe Consolidated Omnibus Budget Reconciliation Act (COBRA) gives eligible workers and their families who lose their health benefits the right to choose to continue group health benefits for limited periods of time under certain circumstances. The life events that enable an individual to become eligible for COBRA include voluntary or involuntary job loss, reduction in the hours worked, transition between jobs, death and divorce. Qualified individuals may be required to pay the entire premium for coverage up to 102 percent of the cost to the plan. — The U.S. Department of Labor

Question: Our company sponsors a group health plan for its employees. What are the consequences if we fail to comply with COBRA?

A major component of the Affordable Care Act is guaranteed preventive care services at no cost to any person with healthcare insurance. At first glance it would appear that free preventive care would include annual wellness exams from the subscriber’s primary care physician along with other yearly checkups at no cost to the subscriber. However further review of this mandate makes it clear that it has a much broader intention.

Does your company’s health insurance plan include health reimbursement arrangements (HRAs) or flexible spending accounts (FSAs)? If so, you should know these plan components are both subject to the Affordable Care Act (ACA) and its “market reform” provisions. The Department of Labor and other principal agencies have issued another round of guidance to answer some of the frequently asked questions about health care reform, including questions about the use of HRAs and FSAs.

According to the new guidance, HRAs and FSAs are covered by the Affordable Care Act’s prohibition on annual benefit limits and are required to provide the same set of preventive health benefits as any other compliant health plan. The sticking point comes when you try to bolt HRA or FSA accounts onto an “individual market” policy. This cannot be done.

When an employee drops dependents and spouses from our company’s group health plan during open enrollment, we provide the dropped individuals COBRA election materials. But our new COBRA third-part adviser is telling us that we don’t have to provide a COBRA election notice to dependents and spouses who are dropped at open enrollment. Is our plan required to offer COBRA coverage to these individuals?

Although many payroll and other employment provisions of the Affordable Care Act (ACA) are only just taking effect — or will go into effect soon — at least one significant element of the law has been kicking around for several years, but not without some difficulty.

Under the ACA, a qualified small business can claim a tax credit for providing health insurance to eligible employees. But numerous questions have dogged this credit since its inception in 2010. Now the IRS has issued final regulations on the credit that should make the law clearer. These regulations, which adopt and add regulations proposed in 2013, are effective as of June 30, but employers have the option of still applying the proposed regulations this year.